Breakout

Foxconn Riots and the Revival of the U.S. Middle Class

A plant owned by Chinese electronics supplier Foxconn Technology was shut down early Monday after a fight involving as many as 1,000 workers and police. Reports are sketchy but China's state-run news media said 5,000 police officers were called in to the Tiayuan plant, which employs 79,000 workers.

View photo

.

Naturally the first questions surrounding the riot were whether or not Apple (AAPL) iPhone 5s were being manufactured at the plant, despite Foxconn operating 13 plants in China, where it employs over 1 million people.

Whether or not Apple products were being made at the plant, the news and unauthorized footage are another headache for the company. This is also yet another example of why the U.S. is about to see an explosion in the number of middle class jobs.

Cost Advantage Waning

Globalization is slowly, inevitably, taking away the cost advantage of producing goods overseas. Wages overseas still lag those paid to workers in the U.S. but shipping costs, public relations headaches and a lack of manufacturing control all make it harder to justify expanding manufacturing at places such as Foxconn.

Arguing that producing domestically will drive up consumer costs misses the point. Prices are going higher regardless because wages are moving up worldwide. That's what happens when you globalize; working conditions and costs start to equalize. It costs more to pay employees a living wage and we're running out of countries where workers will assemble our widgets for 50 cents a day. That's a good thing.

Airbus, Honda (HMC), Boeing (BA) and Ford (F) are just a few companies building or expanding U.S. plants this year. The corporations are coming back to America again for the same reason they left: money.

The U.S. middle class is being reborn even as it's being declared dead -- despite our government's best efforts to stop it. Jobs will be created in America again. It's inevitable, and a very horrific incident like what happened at Foxconn speeds up the process.

Recommended for You

Thinkstock In 2015, the Internal Revenue Service audited only 0.84% of all individual tax returns. So the odds are generally pretty low that your return will be picked for review. That said, your chances ...

Retirement investing is not what it used to be. The problem with the Federal Reserve's attempt to goose the economy is that it killed bond yields, forcing retired investors further out onto the risk curve, making it difficult to find safe stocks to buy.

U.S. home values rose again in October, and a handful of states reported increases exceeded the national average. Housing prices increased 6.7 percent in October compared to the same month a year ago, ...

Conventional wisdom dispensed by financial planners about taking Social Security largely boils down to this: Wait as long as you can. Forty-eight percent of women and 42 percent of men who claimed benefits in 2013 did so at 62, which is the most popular age to start getting Social Security. Part of the reason is that, in some circumstances, waiting simply doesn’t make sense, “The decision on when to start Social Security depends on factors such as how long you expect to live, cash flow needs and marital status,” says Daniel Galli, a certified financial planner in Norwell, Massachusetts.

Another day of all-time highs across the major indices (^DJI, ^GSPC, ^IXIC, ^RUT), with the health care (XLV) sector leading the way up, but financials (XLF) still languishing in the red. Alan Valdes, director of floor operations at Silverbear joins us live from the New York Stock Exchange. To discuss big stories of the day, Alexis Christoforous is joined by Yahoo Finance’s Jen Rogers and Melody Hahm. Mark Zuckerberg is under scrutiny after recently unsealed court documents reveal he may have had inappropriate communication with fellow Facebook board member Marc Andreessen.

Dec.08 -- Taiwan is again a potential flashpoint in U.S-China relations, after Donald Trump broke protocol by talking with Taiwanese President Tsai Ing-wen. Taipei is also re-asserting its claim over contested territory in the South China Sea. Bloomberg's Stephen Engle reports from Taiping in the Spratly Islands.

FRANKFURT, Germany (AP) — Shares in troubled Italian bank Monte dei Paschi di Siena plunged Friday following news reports that the bank's request for more time to raise new capital from investors had been rejected by regulators. But the bank said it hadn't received official notification and was planning to hold another board meeting on Sunday.

General Electric Co. said Friday that it raised its quarterly dividend by 4.3% to 24 cents a share from 23 cents a share. The new dividend will be payable Jan. 25 to shareholders of record on Dec. 27. ...

After prolonged debate, Congress recently passed a $1 billion bill including funds to combat a rampant epidemic of opioid and heroin addiction in practically every region of the country. More shocking, heroin deaths narrowly surpassed deaths from gun violence in the U.S., a tragic grace note to newly released federal data showing an historic surge in tragic fatalities from the widespread abuse of prescription drug painkillers and heroin. The number of overdose deaths involving opioids increased from 28,647 in 2014 to 33,091 in 2015, an 8.9 percent rise, according to the National Center for Health Statistics, an arm of the Centers for Disease Control and Prevention.

President-elect Donald Trump’s proposal to offer U.S. companies a one-time repatriation holiday would bolster domestic liquidity and improve financial flexibility, Moody’s says, but it would likely be ...

Rupert Murdoch may get all of European broadcaster Sky after all after the U.K. phone-hacking scandal scotched a previous effort. Sky said Friday that Murdoch's entertainment conglomerate 21st Century ...

Dec.08 -- Bruin Sports Capital founder and CEO George Pyne discusses TV ratings for National Football League games, slowing growth at ESPN and the new media model for coverage of athletes. He speaks with Scarlet Fu on “What’d You Miss?”

President-elect Donald Trump is stacking his trade transition team with veterans of the U.S. steel industry's battles with China, signaling a potentially more aggressive approach to U.S. complaints of unfair Chinese subsidies for its exports and barriers to imports. Led by Wilbur Ross, a billionaire steel investor and Trump's nominee for commerce secretary, Dan DiMicco, the former CEO of steelmaker Nucor Corp , and three veteran steel trade lawyers, the team is expected to help shift the U.S. trade focus more heavily toward enforcement actions aimed at bringing down a chronic U.S. trade deficit, Washington trade experts said.

Companies can now test self-driving cars on Michigan public roads without a driver or steering wheel under new laws that could push the state to the forefront of autonomous vehicle development. The package ...

Southwest Airlines has stopped new flights between Los Angeles and Mexico because Mexican authorities haven't finished the paperwork formally authorizing the service. American Airlines has been forced ...